From: allin
Overview
Polls and prediction markets serve as tools for forecasting election outcomes, though their reliability and influence are subject to debate [00:43:01]. While polls gather data from real people, prediction markets reflect financial wagers. Both attempt to provide a probabilistic forecast of future events [00:43:04].
Polling Accuracy and Methodology
Traditional polls are dependent on sampling accuracy [00:46:48]. Most polls may only involve about a thousand respondents who are willing to answer calls from unknown numbers, which can introduce bias [00:46:53]. The composition of this sample, and how pollsters weight it based on likelihood of voting or demographics, significantly impacts the prediction for millions of voters [00:47:09]. This reliance on sampling makes polls notoriously inaccurate at times, often with a margin of error that itself can be incorrect [00:47:21].
Nate Silver’s models, for instance, account for the historical performance of different pollsters and weight them accordingly to create a multi-poll prediction [00:44:04]. His system provides a distribution of outcomes, not a single deterministic one, similar to weather forecasting [00:44:24].
Prediction Markets
Prediction markets are a different mechanism where participants put money on their forecasts [00:47:38]. They reflect shifting sentiment and can show trends more easily than polls [00:48:22]. However, they can be “thin,” meaning not a lot of money is trading hands, which can make them susceptible to being moved by small amounts of capital [00:48:50]. For example, some VP markets could be influenced by a small amount of money due to low liquidity [00:47:56]. As of a recent discussion, 320 million across all its markets [00:48:30].
While prediction markets converge to a binary “win or lose” outcome, polls aim to approximate actual vote totals with a margin of error [00:49:19]. Some view them as entertainment or gambling rather than truly useful directional indicators [00:41:30].
Impact on Elections
Polls and prediction markets can impact the voting public because the media and donors cover them, influencing voter turnout through phenomena like the underdog effect or bandwagon effect [00:50:03]. However, their impact might be more at the “edges” of an election [00:50:42]. In critical swing states, voters are heavily influenced by the direct messaging from campaigns, potentially making market or poll data less critical [00:50:57].
2024 Election Outlook
As of a recent analysis, the election is considered a “nail-biter” expected to be decided by a few thousand or tens of thousands of votes in swing states [00:38:42].
Polling Averages for 2024
- Nate Silver’s Silver Bulletin forecasts Harris at almost 47% and Trump at almost 45% [00:37:02].
- Harris reportedly had clear leads in Pennsylvania, Michigan, Wisconsin, Arizona, and Virginia, accounting for approximately 68 Electoral College votes [00:37:12].
- Trump reportedly had clear leads in Georgia and Florida, with Florida alone being 29-30 electoral votes [00:37:21].
- Toss-up states included Nevada (6 votes) and North Carolina (24 votes), which has been “flip-flopping” between candidates [00:37:29].
- Overall, the forecast shifted from a perceived certain victory for Trump against Biden to a “toss-up” [00:37:44].
Shifts in Campaign Performance
- The “Harris bump” in polls reportedly reversed [00:38:00].
- While Democrats previously ran the table in swing states month-over-month, Republicans made significant week-over-week gains (0.5 to 1 percentage point) in the last week, except in North Carolina [00:38:10].
- Polymarket showed Trump back in the lead over Harris, despite the Democratic convention which was expected to boost Harris [00:39:01]. This suggests that as Harris’s campaign released more substance and policies (e.g., economic speech on price gouging, proposed tax hikes including a 25% unrealized gains tax), her standing in the polls might have worsened [00:39:32].
- The Democratic ticket is noted for being “underinvested” in the US economy, contrasting with the Republican ticket’s financially astute background [00:55:10]. For example, Tim Walz reportedly has no financial holdings [00:56:12]. This contrast between career government servants and those with private industry experience presents a choice for voters [00:56:45].
- The perceived lack of financial holdings by some Democratic candidates might appeal to those who feel excluded from the equity economy, such as millennials who struggle with home ownership or student loan debt [00:57:52]. This could align with a broader shift in parties towards populism: right-wing populism for Republicans and left-wing populism (characterized by “soak the rich” mentality and class warfare) for Democrats [01:04:47].